KLE closed at a 52 weeks’ high in closing at $1.83 on Tuesday.
KLE Group operators of the Famous nightclub and Usain Bolt Tracks & Records received US$650,000 loan from its largest shareholder Joe Bogdanovich this financial year, IC Insider understands as the music promoter deepens his interest in the struggling junior market entertainment company.
KLE was listed in late 2012 after raising $90 million in an initial public offering.
Bogdanovich acquired 23 per cent of KLE Group at market value between $0.90 and $1 on the Jamaica Stock Exchange in 2014 when two directors exited the company. The loan listed on the books as other loan at J$73.59 million, represents more than four-fifths of its total loans payable at $87.6 million.
The loan propped up the cash position at the company to record cashflow and equivalents at $30 million in December 2014 but it now returned to a cashflow deficit of $6.9 million at September 2025. The loan was in part utilised to pay down debt, particularly trade payables but left very costly statutory debts at higher levels than before at $21 million, as well as credit card debt at $11 million, with the latter increasing from $2.5 million in 2014.
The company, however, continues to operate with huge negative working capital and negative equity capital of $8 million with accumulated deficit at $130 million.
On the positive side, the company made a rare profit of $2.6 million or 2.8 cents per share from flat revenues of $48.3 million, for the three months ending September 2015 which reversed the $8 million loss for the corresponding quarter a year earlier. Over the nine months, it however, recorded a $32 million loss. The quarterly profit came as the company cut administrative and interest cost sharply by $20 million, partially by limiting the number of days its operates the Portmore based Famous Nightclub. If the bottom-line trend were to continue, the struggling group could end up with profit of $12 million in a full year, and although small, would represent a major turnaround for a company that has been bleeding badly for the past 3.5 years, with losses amounting $139 million during that period.
The group continued its restructuring exercise from 2014 with base operating costs reduced to reflect the leaner organization. Further changes will be made to ensure total alignment with the company’s portfolio and its strategic direction. The Famous operating model was changed in August from a weekly 3 night per week club to a promoter model which saw the location being marketed to promoters as a venue. This has allowed for significant reduction in operating costs with a major shift from fixed to variable expenses,” stated management in the financials adding that it continues plans to franchise its Tracks & Records restaurants globally.
Since the release of the results were released on the December 2, last year, the stock has climbed from 73 cents to trade at $1.87 after bottoming at 43 cents in October.
